Maharashtra Underreported Borrowing, Deficit Breached Legal Ceiling: Centre's Auditor CAG

The Comptroller and Auditor General (CAG) has found that Maharashtra's actual fiscal deficit for 2024-25 breached the Fiscal Responsibility and Budget Management (FRBM) Act's 3% limit, contrary to what the state government reported in its Finance Accounts.The government informed the legislature that its fiscal deficit stood at Rs 1,24,208.74 crore (2.74% of Gross State Domestic Product) and its revenue deficit at Rs 29,994.76 crore (0.66% of GSDP).However, the CAG's post-audit assessment found that after accounting for off-budget borrowings, incorrect classification of expenditure and unpaid liabilities, the state's actual fiscal deficit rose to Rs 1,44,926.46 crore (3.20% of GSDP), while the revenue deficit increased to Rs 36,342.29 crore (0.80% of GSDP).The revision is significant because the FRBM Act requires states to keep their fiscal deficit below 3% of GSDP to ensure prudent borrowing.